SHANGHAI, Jul 4 (SMM) – Trading liquidity of spot zinc picked up in Shanghai on Wednesday July 4 as lower zinc prices prompted downstream consumers to step up purchases.
Traders made offers based on the SHFE 1808 contract today as the delivery date approached and as the price spread between the 1807 and 1808 contracts exceeded 100 yuan/mt.
The SHFE 1808 contract hovered at lows of 22,800-22,600 yuan/mt in the morning trading session. It closed at 22,730 yuan/mt before noon, 380 yuan/mt lower from noon on Tuesday.
In Shanghai, the 0# common brand was offered at a premium of 160-180 yuan/mt over the 1808 contract, and the higher-grade 0# Shuangyan brand at 180-220 yuan/mt. The #0 zinc mostly traded at 22,850-22,920 yuan/mt, down 330-380 yuan/mt from a day earlier.
Separately, transaction volumes shrank in Guangdong amid a pessimistic downstream outlook on zinc prices and adequate supplies. Spot premiums stood 40 yuan/mt higher from Tuesday, at 310-370 yuan/mt over the SHFE 1808 contract today. Traded prices of #0 zinc stood at 23,010-23,070 yuan/mt, down 330-340 yuan/mt from the previous day. The Guangdong-Shanghai price spread widened 30 yuan/mt to 160 yuan/mt.